The 2nd annual PGA Oscars Viewing and Recruitment Party saw 200+ people watching, celebrating and networking with each other on a glamour filled night at the Farmer's Market Planet Dailies restaurant. The all-council event was hosted by the AP & New Media Councils and spearheaded by AP Council Chair Megan Mascena Gaspar and NMC Chair Michael Bellavia. Even before the first Oscar was handed out, 25 candidates had applied to the Guild. With applications still coming in using the event's special discount code, the recruitment event is on track to give the Guild another boost in membership beyond the recently cleared 6,000 benchmark.

Throughout the night, as specialty mixed drinks from sponsors Skinny Girl and Platinum Rye Entertainment flowed, business cards circulated and new members got an opportunity to meet PGA members up close and personal. While the presenters announced the Oscar winners, we had our own awards throughout the night, with prizes generously donated by The Grove and Farmer's Market retailers, an autographed poster from legendary producer Robert Evans, original Oscar posters with Ellen and copies of the latest version of Final Draft software and a free day to the Produced By conference.

With another successful year under the belt, we all look forward to The Producers Guild 2015 PGA Oscars Viewing and Recruitment Party.

Our PGA family lost one of its most treasured voices over the past weekend. Stanley Rubin, age 96, passed away at his home, leaving behind an unmatched legacy of creative work and Guild service.

For how many years was Stanley a member of our Guild? The answer is simple: All of them. One of a handful of founding members of the Screen Producers Guild in 1950, he lived to see the ranks of the Producers Guild swell to more than 20 times its original numbers—in great part due to the inspirational leadership he himself provided as a PGA President, Vice President, Secretary, Board member and trusted councilor.

Under Stanley’s presidency (1975 – 1979), the PGA signed its collective bargaining contract with Paramount and Universal—the last collective bargaining agreement (to date) the Guild would negotiate. Stanley’s clear-eyed wisdom helped the Guild through not one but two mergers, bringing together the Screen Producers Guild and the Television Producers Guild—to form the Producers Guild of America—in 1967, and then, 34 years later, serving on the Merger Committee that joined the PGA to the American Association of Producers (AAP). For over half a century, Stanley was the living embodiment of our Guild’s history, and his loss is a terrible blow not only to the countless friends and colleagues who relied on his wit, insight and passion, but to our collective heritage as an organization.

Stanley can claim a place not only at our Guild’s earliest origin, but at the inception of one of the industry’s most cherished honors—the Emmy Awards. In 1949, Stanley made television history as the producer of the first Emmy-winning film made for television, “The Necklace,” part of his anthology series Your Show Time. Stanley was kind enough to share his experiences creating that piece of television history in a feature for Produced By magazine in 2006.

His career—in classic producer fashion—tacked from television to film and back again, providing him opportunities to collaborate with everyone from Otto Preminger and Mel Blanc to Clint Eastwood and Tony Scott. An accomplished writer as well as producer, he rose to a leadership position within the WGA as well as the Producers Guild, providing for essential inter-guild communication and collaboration.

But it’s Stanley’s singular record of PGA service that makes him unique in the history of our Guild. Stanley was only the second member in the Guild’s history to receive the Charles FitzSimons Award for outstanding service—second only to Charles FitzSimons himself. And how many individuals could boast to have served as a PGA Board member with both Frank Sinatra and Gale Anne Hurd? Just one.

In his speech to the Guild at the close of his presidency in 1979, Stanley said, “I think the single most important thing I can pass on to the members of this Guild is that there is a hidden strength in the PGA that has kept it alive in spite of everything… To be honest, the Board of Directors has said many times over the past three or four years, ‘We’d better make a breakthrough this year, or by next year, there won’t be a Guild!’ Well, we were wrong. There still is a Guild. And there can be only one reason for that—and it’s the hidden strength I mentioned—the fact that there is a genuine need for a PGA.”

More than ever, there is a genuine need for a PGA. But in order to become what it is today, the PGA needed Stanley Rubin. And for more than six decades, every time we needed him, he was there for us.

The 25th Annual Producers Guild Awards was an event to remember. Featuring a historic tie for the Darryl F. Zanuck Producer of the Year Award between 12 Years a Slave and Gravity and an unusual receipt of flattery from Ben Affleck, it is somewhat of a miracle that the show ran just under time.

The event was attended by influencers from every corner of the industry, from the most recognizable star actors, directors and musicians, to the most respected producers and industry executives. Opened by a terrific Johnny Carson impression by the inimatable Kevin Spacey, the Awards represented the best of Hollywood across it's history, present, and future. Honoring ingenuity, legacy, social consciousness, boldness and judiciousness, the Producers Guild Awards have come to recognize the beating heart at the core of entertainment.

In the past
few months, it has become clear that administration of the Affordable Care Act
(ACA) and preparation for compliance are highly complex processes which are
stirring up a great deal of confusion. Lack of adequate preparation is going to
create challenges for all employers, and none more so than those of us in the
production world. In co-employment relationships, such as those that exist within
the entertainment industry, the ACA provides that the co-employer who directs
and controls the worker’s day-to-day functions is the responsible employer.
This means that the production company typically will be responsible for
providing coverage under the ACA, and that has come as a surprise to much of
the industry.

All employers
with at least 50 full-time employees and equivalents must offer affordable and
adequate health coverage starting January 1, 2015, or pay a penalty tax. The
IRS issued proposed regulations at the end of 2012 to implement this employer
play-or-pay health coverage mandate. The mandate for individuals to obtain
minimum essential health coverage, however, begins January 1, 2014. On October
1, the public health insurance exchanges opened for business and it was
reported that thousands began signing up. Fulltime production employees not
covered under union or employer health plans will be required to meet this
requirement or face a penalty, and it is up to all of us to help get the word
out to them.

What does this
all mean for producers and members of the producing team? How are the unique
needs of such a highly transient workforce being addressed? Where does one begin
to assess how they will be impacted by the requirements and what the best
course of action should be?

The industry
has looked to my company for answers and solutions that will help mitigate
their exposure. Fortunately, because of our role as a statutory employer of
production workers, we are uniquely qualified to assist. For the better part of
the past year, Joe Scudiero, our Senior Vice President and Chief Labor Counsel,
and I have been analyzing how the ACA will affect our industry. We’ve been
meeting with all of the studios and many major and commercial independent production
entities and hosting seminars and webinars in order to discuss what we have
learned.

Among the top
concerns we have heard from the industry are confusion over what is affordable
and adequate coverage, determining eligibility, lack of consolidated reporting across
productions and production payroll companies, misunderstanding of government
reporting obligations, and knowing where to find an insurance plan to meet the requirements.
There will be instances in which a producer believes that it might be more cost-effective
to pay the penalty rather than provide coverage but even this determination is
complicated. For instance, though you would only be obligated to provide
insurance for those full-time employees not covered under a union or employer
health coverage plan, if you opted to pay the per-head penalty for not
providing coverage, the penalty would be assessed on almost all workers on your
production, including union members. A myriad of questions abound regarding
what happens when a production worker is between shows and how COBRA
eligibility will work; and while the studios have human resources and benefits
professionals who are able to address these questions, we know that a majority
of independent production entities will be on their own.

Producing
entities had their first ACA obligation begin on October 1 and this will be ongoing
when hiring new workers. Pursuant to Department of Labor regulations issued in

May 2013,
employers must distribute a Notice of Exchange (NOE) to all current employees (including
union, non-union, full-time, and part-time) stating whether or not they will offer
compliant health coverage and informing their employees about government health
insurance exchanges. While any new hires through 2014 must be provided the
notice within 14 days of hire, beginning in 2015, the NOE must be provided on
the date of hire.

We do not
recommend that you attempt to answer all of the ensuing questions on your own,
but rather seek the assistance of a trusted and knowledgeable advisor. Though employer
compliance is not required until 2015, we are working with a number of studios
who are choosing to begin compliance in January 2014. We will be happy to share
what we all learn from the experience.

In the
meanwhile, following are some essential details and sample scenarios to help
you begin to comprehend the new laws. Though by no means a comprehensive set of
guidelines, it is intended to assist you in planning your next steps toward
compliance. There are a number of resources available to you — please do not
hesitate to contact my team or your preferred service provider for more
in-depth information and guidance or visit our online compliance center at
www.entertainmentpartners.com/aca/. Though it may initially seem overwhelming,
it is important to remember that all businesses are facing the challenge of
wading through these new requirements and that we are all in this together.

The ACA
Employer Mandate - Play or Pay?

America’s new
healthcare law is commanding everyone’s attention these days and has created an
entirely new vocabulary for employers. One new term — "play or pay” — takes on a
different meaning from what the industry is used to; here it is shorthand for
the decisions employers must face in 2015. For employers in the entertainment
industry, arriving at that decision is not a simple calculation.

For example,
the majority of your crew on a given union production is receiving coverage
through their union or guild plans. Does your company opt to play by offering compliant
coverage to the remaining full-time, non-union crew? Or do you simply pay the
no-coverage penalty tax on this small segment of your workforce?

While the
latter may seem to be the easiest option, the decision is not as
straightforward as it looks and will often not be the most cost-effective
choice. Review the graph and infographics below for a more comprehensive
breakdown.

Assessing the
Impact

As production
companies begin to grapple with the employer responsibilities, properly assessing
their workforce and estimating their play-or-pay options will be crucial to managing
production budgets in 2014 and beyond. However, this is only one simplified
example of the changes entertainment employers face under the ACA. Their jobs
are even tougher as they tackle the ACA’s many complex requirements and
challenges, including:

·
Adapting
to changing ACA requirements

·
Managing
all ACA employer mandate responsibilities

·
Evaluating
employee status and healthcare eligibility correctly

·
Accurate
analytics and ACA reporting to the IRS

·
Ensuring
compliance and controlling costs

*The current
regulations are interim and final guidance on the employer mandate is expected
to be issued before 2015.

PLAY or PAY?

PLAY

Start: 400 Total
Employees

MINUS 40
part-time employees

The ACA
doesn’t apply to them outside of determining employer coverage.

The employer
mandate applies only to full-time employees. You are required to offer coverage
to at least 95% of your full-time employees (and their dependents) to avoid
Part A penalties ($2,000 annual penalty tax per full-time employee minus the
first 30 full-time employees).

MINUS 40
variable-hour employees

(e.g. day and
weekly hires)

Variable-hour
employees are not entitled to coverage until they’ve completed a full
measurement period and satisfied full-time eligibility.

MINUS 80
short-term employees

They work
full-time, but less than 90 days.

A full-time
employee who is employed less than 90 days is not eligible for coverage if the
employer has made an offer of coverage subject to a 90-day wait period.

MINUS 200
union workers

They’re
covered by their union benefit health plans.

For 2015, you
will be compliant if you are contributing to a multi-employer health plan (i.e.
union/guild plans) that meets the affordability, adequate value and all other
requirements.

Headcount for
coverage calculation = 40 employees

Average annual
premium = $3,000

$120,0001
Total Employer Cost (tax deductible)

PAY

Start: 400 Total
Employees

MINUS 40
part-time employees

The ACA
doesn’t apply to them outside of determining employer coverage.

The employer
mandate applies only to full-time employees. You are required to offer coverage
to at least 95% of your full-time employees (and their dependents) to avoid
Part A penalties ($2,000 annual penalty tax per full-time employee minus the
first 30 full-time employees).

MINUS 40
variable-hour employees

(e.g. day and
weekly hires)

Variable-hour
employees are not entitled to coverage until they’ve completed a full
measurement period and satisfied full-time eligibility.

MINUS 0
short-term employees

If there is no
plan offered, the employer is unable to exclude short-term employees from the
Part A penalty base calculation.

MINUS 0 union
employees

Since your
non-union employees exceed 5% of your production’s workforce, you will be
required to pay the "no coverage” penalty tax of $2,000 (i.e. Part A) per
full-time employee (minus the first 30 full-time employees).

MINUS 30
full-time employees

There is a
safe harbor to exclude the first 30 full-time employees.

Headcount for
coverage calculation = 290 employees

Penalty tax
over 12 months = $2,000

$580,0002
Total Employer Cost (non-deductible)

UNDERSTANDING
PRODUCTION WORKER OPTIONS

Employers may
have one year before they must comply with their employer mandate obligations
under the ACA, but this is not so for individuals. As of January 1, 2014, individuals
must enroll in "minimum essential coverage” or pay an annual penalty of $95 or
up to one percent of income, whichever is greater. The yearly penalty increases
in future years.

What health
coverage options do production workers have? With the exception of a minor
segment that would fall under public programs such as Medicare and Medicaid,
health coverage is available through two primary sources: group plans and
public exchanges. Here’s a quick look at these sources:

Group Plans

A large
segment of the production workforce may already be covered through the unions and
guilds. Others may have coverage through their spouses’ plans. The remaining
segment of eligible, non-union workers can obtain a health plan through their
employer group policy (if offered) or opt to get their own individual plan
through the public exchanges. An obvious advantage to choosing an employer plan
is the employer contribution, limiting the worker’s share of the premium to no
more than 9.5% of adjusted gross household income.

Transportability
is one of the most essential considerations when offering health benefits to a
transient workforce.

The drawback
to a traditional employer-based group plan is when production workers move on
to their next project, they’ll face re-enrolling in a new employer group policy
likely to involve a different network, doctors, and premium rates. Union
members covered by a multi-employer health plan avoid this issue since they
maintain the same coverage regardless of the project or employer if they meet
eligibility requirements. Similar to multi-employer plans, there are employer group
plan options available through a private entertainment industry exchange that
enable non-union workers to carry coverage from production to production.

Public
Exchanges

Publicly-run
exchanges offer health coverage for those who are ineligible for or decline
group health plan benefits through their union, guild or employer. Some
eligible non-union workers also may elect to buy coverage through a public
exchange. Once they enroll in a health plan through the public exchange, they
carry their coverage with them, and depending on their income level, they may
receive a government subsidy to reduce the price of their health plan if they
have not declined an offer of compliant health coverage from their employer.
Those workers who decline compliant employer sponsored coverage will pay 100%
of the cost on an after-tax basis and will not qualify for a subsidy. When shopping
the exchanges, the key variables impacting a plan’s cost and value include tax
subsidies, benefits, coverage limits, out-of-network reimbursements, stability,
and plan administration and support services. While the federal marketplace has
gotten off to an undeniably rocky start, several state exchanges have fared
better. Nonetheless, the volatility of the enrollment process and uncertainty
of the insurance market should also be factored in when evaluating health
coverage options through public exchanges.

Some
production entities may regard offering health insurance or paying the penalty
tax as solely a financial decision, while others may view offering insurance an
incentive to attract and retain high-quality workers. Either way, it is up to
employers to help their crews understand their options and properly assess
their choices.

*To be
eligible for a subsidy, a person (1) must not be eligible for medical insurance
through an employer-based plan and (2) have a household income of less than
400% of the federal poverty level.

THE INDIVIDUAL
INSURANCE MARKET

Coverage through
individual insurance market plans may also be an option; however, many carriers
are pulling out of the individual market to avoid the uncertainty tied to ACA changes
and are directing their administrative and marketing services to the exchanges.

Individual
market plans and employer plans specific to the entertainment industry are listed
under "ACA Resources.”

The Producers Guild is proud to unveil our new member video website that hosts content from our growing YouTube channel (do not forget to subscribe at youtube.com/producersguild) as well as new "Member Exclusive" content that you will not be able to access anywhere else!

Spearheading the debut of our Member Exclusive videos is the invaluable "Healthcare Reform Seminar." Also inside the Member Exclusive section you will find a cornucopia of helpful information from Produced By Conference 2013's full sessions. Please visit us to see what we have available and be sure to keep coming back as we provide enriching Q&A's, seminars, and interviews throughout the year.

Member Exclusive Videos include:

California Healthcare Reform Seminar

New York Healthcare Reform Seminar

Legalities of Internships

Digital VIP Salon with Robert Evans

Expanding The Globe 2013

Digital Storytelling

Lone Survivor Q&A

Inside Llewyn Davis Q&A

Labor Day Q&A

Maximizing The Georgia Tax Credit

Produced By Conference 2013 Full Sessions Available as Member Exclusives:

360 Profile: Cross-Over Talent

All The World's a Stage: Building New Franchises Through Transmedia

The Unlocked Picture: Global Opportunities in VFX and 3D Conversions

The State of Producing - Finding Funding, Tying Up Talent & Securing Screens